Five years ago property experts predicted that the housing market would flourish, and prices would soar, with increases of up to 50% in 2010. However, at the time nobody’s crystal ball showed a hint of the recession which would bring the world to its knees just a few short years after FIFA awarded South Africa the World Cup. According to a report on the IoL site, in 2005 experts said winning the right to host the World Cup had created a positive sentiment towards SA property internationally. At the time, Saul Geffen, the managing director of ooba (formerly MortgageSA), analysed how major global sports events like previous World Cups and the Olympics had influenced property markets in other countries.
Although much of the hype and propaganda about the 2010 World Cup’s impact on property in South Africa has been hot air, the event’s effect is now being felt and there are indications that it will accelerate the recovery of the residential property sector, says Lanice Steward, MD of Anne Porter Knight Frank. ’Until recently many of us, I think, did not appreciate just how much exposure this World Cup event will give to South Africa and, in particular, how widespread the TV coverage will be. However the draw in Cape Town opened our eyes to the long-term beneficial spin-offs of the event. We have to come to terms with the fact that no other event, not even the Olympic Games, is capable of pulling in 120 million to 150 million TV viewers as the World Cup is expected to do,’ says Steward.
Although the business community - and the tourist industry in particular - continues to welcome and promote the 2010 World Cup hype, this is leading to a potential over-supply situation in short term residential rental accommodation, says Lanice Steward, managing director of Anne Porter Knight Frank (APKF). ’APKF runs active rental services in many of the areas likely to prove popular with World Cup visitors to Cape Town, and we have found that the hope of almost ludicrously high rentals over the World Cup period has led to many home and flat owners holding back from signing on long-term tenants,’ said Steward. According to a report on the IoL site, right now demand is strong for long-term rentals in Green Point, Sea Point and Camps Bay.
The outlook for property for 2010, while still mild, was far better than 2009, auctioneers Alliance Group said Wednesday. In 2010 people will start spending more as the stock market continues to rally and the economic outlook improves, said chief executive Rael Levitt. Keeping the show on the road over the last 18 months of turmoil had been a true test for many developers, brokers and banks . In 2010 the challenge will be to refocus on the long term and what the post-World Cup period will bring. 2010 may well be a tale of two halves, Levitt said, adding that the impact of the World Cup in the first half of the year could not be overestimated.
Now that the new Green Point stadium is all-but complete and lit up with a magical soft glow at night almost all the criticism and the dread that it would downgrade the precinct have melted away. So says Lanice Steward, MD of Anne Porter Knight Frank (APKF), who adds that it is ’impossible not to be impressed’. ’When the lights come on after dark, one has the impression that a benign spaceship has landed here. It is just far enough away not to impinge on the attractive cosmopolitan cafι district on Somerset Road (which has proliferated over the last year), but close enough to give a feeling that something very exciting, very modern and almost beyond our understanding has happened here.’
The Zimbabwean government has registered more than 4 000 houses that will be turned into lodges ahead of the 2010 World Cup soccer showcase in South Africa next year, a senior Govern-ment official has said.
This followed the Zimbabwe Tourism Authority’s approval of applications by some homeowners to turn their houses into lodges to complement hotel accommodation for soccer tourists expected in South Africa.
Zimbabwe needs a total of 10 000 beds for the World Cup showcase in South Africa.
Tourism and Hospitality Industry Secretary Dr Sylvester Maunganidze said Government was expecting to approve more applications and ensure adequate accommodation for the football extravaganza.
He said Zimbabwe has seen an upsurge of in-bound tourists following concerted calls for the lifting of travel bans by the West and other countries.
Letting agents have cautioned homeowners - expecting to make a fortune in rental income during the 2010 World Cup - to consider their options carefully before choosing tourists over long-term tenants. FIN24 reports that Cape Town is already having a shortage of rental properties available on six- to twelve-month leases, as owners take their properties off the market, hoping to let them to tourists in June and July next year. These are not only owners with seaboard properties, but even those in suburbs such as Durbanville and Parow who blithely assume they will be able to let their apartments for R3 000 a day and more.
Green Point stadium under the spotlight 09/12/2009
Now that the new Green Point stadium is all-but complete - and lit up with a magical soft glow at night - almost all the criticism and the dread that it would downgrade the precinct have melted away, say Meryl Kreuger and Velma Knight, Anne Porter Knight Frank’s agents for Sea Point and Green Point. ’It is impossible not to be impressed,’ said Knight. ’When the lights come on after dark, one has the impression that a benign spaceship has landed here. It is just far enough away not to impinge on the attractive cosmopolitan cafι district on Somerset Road (which has proliferated over the last year), but close enough to give a feeling that something very exciting, very modern and almost beyond our understanding has happened here.’ According to a report on the iafrica.com site, Kreuger added that almost as impressive as the building itself have been the City Council’s upgrading of the surrounding landscapes and, more particularly, the golf course.
2010 expected to have long-term effect 03/12/2009
The South African property market is performing well compared to other global markets and the 2010 World Cup will affect the real estate market over the long term, notes a report on the News24 site. Commenting on the 2010 World Cup’s impact on the real estate market, RE/MAX International’s Vice President for Franchise Sales, Peter Gilmour said he is reserved about a major once-off boom. ’I anticipate that the World Cup’s impact on foreign real estate investment in South Africa will yield results over the long term, more specifically over a 23 year period after the event;’ he said. Foreigners visiting South Africa during the tournament will be in a ’vacation’ - and not ’property buying’ - mode, but will be impressed by the real estate opportunities they see.
A property owner in Clifton on Cape Town’s Atlantic Seaboard has secured house rental of $1m for the duration of the 2010 World Cup. FIN24 reports that Clinton Braude, director at Ronnie Matthews Estates, said the month-long rental is the agency’s highest deal to date, and most likely a new record for South Africa. ’The villa has been rented to an undisclosed international celebrity to use as a base during a month-long visit while in South Africa during the World Cup in June, and is situated in sought-after Clifton - Cape Town’s millionaires’ playground,’ Braude said. He added more deals would be closed after finalisation of the tournament draw on Friday.
Seeff Properties has steadily been signing up private homes in a bid to meet the huge demand for accommodation for next year’s 2010 World Cup, with more than 2000 properties already on its books. Business Day reports that homeowners can earn from R750 to R19 000 a day by opening their homes to the expected 450 000 visiting soccer fans. Seeff has already had huge success at the top end of the market, including securing a group of Russian businessmen who have rented 12 villas for the duration of the tournament.
Locals also booking 2010 accommodation - 16/11/2009
As the build-up to the 2010 World Cup gets ever more frenetic, estate agents continue to sign up properties for home owners who wish to cash in on rental income during the tournament, notes a report on the IoL site. But, says Seeff Properties West Coast chief executive Heinrich Koorts, Cape Town residents are themselves booking accommodation as they require somewhere to stay while their own homes are occupied by overseas visitors.
R600m worth of luxury 2010 packages sold - 15/11/2009
How much would you pay to stay in a luxury seaside villa in Clifton, Cape Town, with its own butler, chef, home cinema, and walk-in cellar. Try R4.2m a month. And Cape Villas, the rental agent, reckon it’s a ’bargain’. The Times reports that with just less than 250 days to the 2010 World Cup, international millionaires and billionaires are paying cash to secure a home in the tiny coastal basin. For many who have splashed out R11.2-million for the soccer showcase’s top package - which entitles the holder to watch all major matches from a private suite - cost is not a factor. Almost R600-million worth of packages have been sold.
Owners are keeping their investment properties empty until the World Cup soccer tournament in 2010, said Seeff Properties. ’I am increasingly being asked by owners to withhold their investment property to ensure availability during the World Cup,’ saidJules Arnott of Seeff Properties. The Herald reports that Arnott said Match, sponsors and media to the World Cup, did not cater for the marketing of non-graded residential accommodation for the average fan. He said there was ’a huge demand’ for beds predicted (65 000 in some cities on peak nights), especially in central areas with easy access to the Greenpoint stadium in Cape Town. ’It would certainly make sense to market your property for rent during the Football World Cup,’ Arnott said.
The infrastructure development and improvements taking place around the Ellis Park stadium sports precinct before the 2010 World Cup are set to become a catalyst for rejuvenation in the adjacent suburb of Doornfontein, says Oscar Mello, leasing, sales and investment broker for Pam Golding Commercial in Gauteng. ’The Ellis Park precinct, incorporating Ellis Park Stadium and Johannesburg Stadium, is undergoing a major facelift and attention is beginning to focus on nearby Doornfontein, a semi-industrial area where vacancies have increased in the past few years due to industrial operations moving to dedicated industrial areas,’ says Mello.
While home buyers still consider sea views a priority, stadium views are now the very next best feature they request, says Carol Reynolds, manager for Pam Golding Properties in the Durban and Durban North areas. ’Anticipation regarding the forthcoming 2010 World Cup is increasingly evident and along with it, there’s a revived optimism in the marketplace, with the general sentiment being that we are being buffered to some extent from the severities of global recession because of this world-renowned event,’ said Carol. ’Coupled with this is the fact that properties with views of the new Moses Mabhida Stadium β with its spectacular arch feature and innovative design β are already sought after. My Property reports that areas such as Morningside and the Berea afford exceptional stadium views, with some of the luxury penthouses on the Berea providing sweeping vistas across the stadium and beyond.
A German buyer wants to buy a beach house in South Africa with money from Europe. He would like to finance it with a loan from a German bank to benefit from Europe’s lower interest rates. To help pay for the holiday house in South Africa, he wants to let it out during the months he is not visiting his granddaughter. My question is: how hard will it be to transfer the letting income here to Germany to repay the bond? - SW. The question you ask is quite topical, given the build-up to the 2010 World Cup and the international interest in buying and letting property in South Africa. It has both tax and exchange control consequences - but the short answer is that the money can be repatriated to Germany with relative ease, so long as your paperwork is in order and you know about the pitfalls along the way.
While investors in luxury apartments and villas have their eyes firmly fixed on the rental bonanza that the 2010 World Cup is likely to bring, they also need to consider ways to attract sustainable rental options both before and after the tournament, notes a CBN report. According to Tanya Joubert, Director of Cape Locations, which represents a variety of luxury properties including apartments and villas in Cape Town and the Cape winelands area, property owners need to have a plan in place to ensure their properties are consistently generating an income.
The coastal suburbs of Bantry Bay, Llandudno, Clifton and Camps Bay and are abuzz with construction activity and increased property sales compared to this period last year, which is hardly in line with overall economic predictions for the industry. Business Day reports that the Atlantic Seaboards economic contribution to the city, derived from the combination of newly constructed homes, renovations and property sales, is having a knock-on effect on both consumer spending and property prices. Cape Town, which recently received a huge budget increase from R440 to R660m towards the completion of the nearby Green Point stadium where the 2010 World Cup will be hosted, may well benefit from such positive consumer sentiment.
Pam Golding set to launch 2010 rental service 09/09/2009
Pam Golding Properties is preparing to launch a dedicated rental service for the 2010 FIFA World Cup, in anticipation of the demand for short-term accommodation during this period. CBN reports that the personalised service will be restricted to a selection of luxury homes, targeted at the upper end of the visitor market. PGP will limit the number of properties in this portfolio, focusing on the Atlantic Seaboard, City Bowl and Southern Suburbs. PGP’s MD for the Western Cape metro region, Laurie Wener cautions against drastic over-inflation of prices during the World Cup period, saying that expectations of massive daily rentals may well be pipe-dreams.
Nelson Mandela Bay is undergoing a massive spring cleaning ahead of the 2010 World Cup, but when international visitors begin descending on the city in 11 months’ time, not even a makeover will be able to hide the city’s greatest eyesores. The Herald reports that Central and Richmond Hill, two of the oldest and most historic suburbs in the city, have most of these tattered buildings, some owned by controversial property magnate Ken Denton. Historical Society of Port Elizabeth chairman Bill Wright says the organisation is disappointed with the slow rate at which Denton has started to restore some of his properties. DA councillor Terry Herbst said Central especially was a ’scandalous disgrace’, adding that he blamed now suspended municipal manager Graham Richards for allowing the rot and decay of certain buildings to continue.
South Africans who think the upcoming 2010 World Cup will be giving the housing market a boost, are building castles in the air. Although foreign property markets have benefitted from international sporting events in the past, property experts say the timing of the World Cup is not ideal. Property24 reports that a recent survey by the property portal propertygenie.co.za showed that 41% of the respondents are of the opinion that the event will boost property prices, while 59% said it won’t.
Taking advantage of 2010 opportunities - 14/07/2009
’Available: Luxury house to rent for 2010 World Cup. Three bedrooms, two bathrooms, kitchen and pool. Starting at a daily rate of R15 000. Will take euros, dollars, pounds.’ According to a Mail & Guardian report, ads such as these are becoming a lot more commonplace in the run-up to 2010 as enterprising local property owners seek to lease out their homes to visiting football fans. Rental services run by real estate companies such as Seeff Properties have also taken off, as have private listings on websites, putting fans directly in touch with homeowners.
Property owners who believe they can make rental profits off visiting soccer fans to the 2010 World Cup may find themselves up the creek without a paddle if uninsured damage is inflicted on their properties. According to a report on the IoL site, thousands of South Africans are looking forward to a rental bonanza from soccer enthusiasts, but short-term insurance brokerage Glenrand MIB warns that uninsured losses could severely dent or even exceed any rental profits made.
The 2010 World Cup won’t boost the country’s sagging property prices, but attractive Cape Town pads are likely to get the biggest fillip from the global event, notes a report on the iafrica.com site. This is according to the result of a poll by Propertygenie, South Africa’s largest online search property portal. Johan Strydom, Managing Executive of Propertygenie, South Africa’s leading property listings website, said that 59% of people surveyed believed that next year’s tournament would not boost property prices, while 41% of people said it would.
A business opportunity worth millions - 25/06/2009
More than 55 000 soccer fans are yet to book accommodation for the 2010 World Cup, notes a Property24 report. ’As we count down to the most historic event this country is likely to see since the inauguration of Nelson Mandela, we realised that the fact that 55 000 fans still have nowhere to stay presented a business opportunity worth an estimated R400m for the property market,’ said Seeff Properties chairman Samuel Seeff. He said few realised the extent of the growing accommodation crisis. ’For the first time, FIFA has had to sign up non-graded accommodation for its officials because of the shortfall of accommodation in South Africa. MATCH, which accommodates VIP’s, sponsors and the media, is 20 000 beds short for the 30-day period.’
Those who had their money in property in the downturn have usually fared far better than those who were in JSE shares or, indeed, had invested in certain sectors such as travel or the motor-related industry. So says Ivan Neethling, chairman of the Western Cape Institute of Estate Agents, who adds that ’we have seen values in property drop 10% to 20%, but at one stage the JSE was 60% down on its 2007 highs and for a long time has been down 40%’. According to a Property24 report, at the moment, said Neethling, guesthouses are the flavour of the month because buyers, anticipating a massive influx of tens of thousands of visitors to the Western Cape over the 2010 World Cup period, are expecting good returns on this sector.
In a land claims case, an Mpumalanga farm-worker community is in danger of losing its claim after selling 118 hectares of their newly-won land to the Mbombela municipality in Nelspruit for R1 so that a R1bn 2010 stadium could be built on it. Legislation stipulates that land beneficiaries may not sell or otherwise alienate their land for five years without a certificate from the Minister of Land Affairs giving them the go-ahead. The Matsafeni Trust, representing the Mdluli claimants, got the land only in 2003 and the R1 deal was signed in 2007 without the Ministry’s consent, notes a report in The Star. Now, in a deal involving various levels of government, the Matsafeni are to be paid more. But in a new twist, the Nkosi clan say they are the legitimate beneficiaries of the land and lodged their claim in December 1998 four years before the Mdluli claim was lodged. They did not receive a response.
The 2010 World Cup is drawing closer and the extensive global exposure of SA is expected to result in an increasing number of visitors to the country and ultimately a hugely increased investment in property, notes an eProp report. ’As we start approaching the six-month build-up prior to the World Cup, it is likely that the hype and enthusiasm generated will have a positive effect on all segments of the market - supplemented by the favourable and significant infrastructural spend,’ Pam Golding Property group CE Andrew Golding says. ’The biggest impact of 2010 on the property market in Johannesburg will be the significant increase in the value added to homes in and around the huge infrastructural development that is being put in place for the event,’ added PGP’s MD for Gauteng, Ronald Ennik.
With the 2010 World Cup drawing closer, there’s much debate as to the real spin-offs this major event will have for South Africa. Comments Dr Andrew Golding, CE of the Pam Golding Property group: ’While we are now in the run-up to this event, as we start approaching the six-month build-up prior to the 2010 World Cup, it is likely that the hype and enthusiasm generated will have a positive effect on all segments of the market supplemented by the favourable and significant infrastructural spend. Ronald Ennik, PGP’s MD for the Gauteng region, said ’the biggest impact of 2010 on the property market in Johannesburg will be the significant increase in the value added to homes in and around the huge infrastructural development that is being put in place for the event’.
